Chainlink's exchange reserve has dropped sharply, suggesting growing investor confidence in holding LINK off exchanges.
LINK's price decline below $10 correlates with a notable decrease in exchange reserves, pointing to potential price volatility.
Technical indicators like RSI and MACD suggest a possible reversal for LINK as it approaches key support and resistance levels.
Chainlink (LINK) has been showing a notable decline in its exchange reserve, which could be a sign of growing investor confidence. According to @QuintenFrancois on X, the supply of LINK on exchanges is “dropping hard,” a trend he described as “bullish.”
https://twitter.com/QuintenFrancois/status/1821920174997729670
This observation comes as the exchange reserve for LINK has substantially decreased from late April to early August, accompanied by a fluctuating yet generally downward trend in the price of LINK.
Substantial Drops in Exchange Reserve
During the period from late April to early August, Chainlink’s exchange reserve started around 153.7 million LINK. After maintaining relative stability from early May to early June, the reserve experienced a sharp increase in mid-June, which was soon followed by a steep decline.
Notably, the most notable drops in the exchange reserve occurred in mid-June and early August, aligning with key price movements. The price of LINK, which started above $15 and peaked above $18 in mid-June, experienced a sharp decline, falling below $10 in early August. This inverse relationship between exchange reserve and price suggests that as LINK is moved off exchanges, the asset's price might face increased volatility.
Current Price Trends and Market Position
At press time, LINK was trading at $10.64, a 4.14% increase in the last 24 hours. The asset currently holds a market cap of $6.44 billion, ranking it 16th by market capitalization. Despite this uptick, LINK’s 24-hour trading volume is down by 31.22%, sitting at $172.73 million, ranking 23rd in terms of volume.
With a circulating supply of 608.1 million LINK, the asset's fully diluted market cap reaches $10.59 billion. However, the ongoing decline in exchange reserves remains a critical factor for future price action.
Technical Indicators Show Potential Reversal
The candlestick chart for LINK against USDT reveals a bearish trend, though recent data suggests a potential reversal. The current price of $10.64 marks a slight daily increase, with support identified around $9.00 and resistance at $10.70. The Relative Strength Index (RSI) stands at 37.39, nearing oversold territory, which could indicate a buying opportunity if the trend changes.
Source: TradingView
Meanwhile, the MACD is in bearish territory, but the decreasing downward momentum suggests that a reversal might be on the horizon. As LINK continues to recover from the drops seen in the entire crypto market on Monday,, the interplay between its exchange reserve and technical indicators will likely influence its short-term price trajectory.
The post Analyst Bullish as Chainlink’s Supply on Exchanges Drops, Price Nears Key Reversal Point appeared first on Crypto News Land.
